Any company that takes deposits from customers and facilitates transfers among customers is heavily regulated in most countries. These regulations include license requirements, bonds, insurance, know your customer laws, and anti-money-laundering compliance among others. The BitShares block chain provides gateways with all of the tools necessary to comply with these regulations.

If you are in this business you are already maintaining a database tracking user deposits and your database is probably logging every single transaction and balance change. Your database knows exactly who is owed what at any point in time. You also have the power to seize or freeze user balances at the demand of law enforcement. BitShares provides you with all of these features as well including:

1) Ability to white list public keys that may control a balance of your asset.2) Ability to freeze all funds and stop all trading of your assets 3) Ability to transfer any balance of your asset from any user to any other user

In other words, if you are operating a legally complaint crypto currency exchange, then you can easily expand your business to becoming a BitShares gateway.

My question is, how are these toolkit features limited to gateways only, and what safeguards insure they cannot be used against non-gateway accounts / addresses?

There's probably many ways this could be accomplished, and I'd be shocked if there was any possibility non-gateway accounts could "fall prey" to asset seizure, but I would like this answered by BM explicitly given how onerous it sounds. Less technical types may be driven away if they hear "the ability to freeze assets is built into every BitShares client".

Any company that takes deposits from customers and facilitates transfers among customers is heavily regulated in most countries. These regulations include license requirements, bonds, insurance, know your customer laws, and anti-money-laundering compliance among others. The BitShares block chain provides gateways with all of the tools necessary to comply with these regulations.

If you are in this business you are already maintaining a database tracking user deposits and your database is probably logging every single transaction and balance change. Your database knows exactly who is owed what at any point in time. You also have the power to seize or freeze user balances at the demand of law enforcement. BitShares provides you with all of these features as well including:

1) Ability to white list public keys that may control a balance of your asset.2) Ability to freeze all funds and stop all trading of your assets 3) Ability to transfer any balance of your asset from any user to any other user

In other words, if you are operating a legally complaint crypto currency exchange, then you can easily expand your business to becoming a BitShares gateway.

My question is, how are these toolkit features limited to gateways only, and what safeguards insure they cannot be used against non-gateway accounts / addresses?

There's probably many ways this could be accomplished, and I'd be shocked if there was any possibility non-gateway accounts could "fall prey" to asset seizure, but I would like this answered by BM explicitly given how onerous it sounds. Less technical types may be driven away if they hear "the ability to freeze assets is built into every BitShares client".

Here is how I see it:

The control is based on what type of asset it is, not on accounts or addresses. On the BTS blockchain, Bitstamp would be in control of all bitstampUSD, whereas they have no control over bitUSD. If you are worried about gateway control then you simply swap your bitstampUSD for bitUSD.